Summary
Description
OID Report Changes
The amended Compensation for Occupational Injuries and Diseases Act (COIDA) of 2022, was promulgated on 17 April 2023. The Department of Employment and Labour have published the
“ROE explanatory memorandum” for which they provided guidance on how to report earnings calculated to complete the ROE form. These amendments directly affect the payroll.
Maximum Earnings
The return of earnings (ROE) explanatory note for the 2022 reporting season (Government Gazette No. 48337) has provided guidance on how the annual maximum earnings should be applied:
- The limit is an annual limit and should not be pro-rated as a monthly figure.
- The annual limit must be applied to earnings irrespective of whether the employee worked for less than 12 months.
This means the maximum earnings should be the lessor of actual earnings and the annual limit.
The Fund did not clarify how the monthly earnings must be reported for the purpose of the manual ROE submission, but we applied the following calculation method:
- If the employee’s/director’s earnings are greater than the maximum annual limit, the monthly earnings should be the maximum annual limit divided by period of service.
- If the employee’s/director’s earnings are less or equal to maximum annual limit, the monthly earnings should be the actual monthly earnings.
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Resolution
Employee and Director Count
We have updated the method of calculating the employee count to provide for a method for“headcount” and “average” count.
For example, if the employee/Director was employed for only 3 months during the year, should they be counted as 0.25 (average) or 1 (headcount) for that year.
The Fund, however, clarified that when an employee is promoted to a Director during the year, they will be counted as a director for the whole year.
The employer is given an option to apply either an average count or a total headcount of employees and directors employed during the year.
We have amended the last Print-time Selection Screen to accommodate this:
Explanation of the Detail Report
Number of Employees
NOTE: For an explanation of the sections and calculations, the OID limit of R568959 was used. The value will change every year however, the application of the formulas and calculations remain the same.
| Emp Code | The employee code is created for the employee on the payroll system |
| Employee Name | The employee's initials and surname as per the information screen |
| Month | The calendar month and year for the earnings received |
| Actual Monthly earnings | The actual earnings as per the selections made on the report |
| Adjusted OID Earnings |
|
| Periods in Service | The employee's OID periods are saved on the Employee (IS) Information Screen, under the Statutory details tab. The OID periods on the IS screen will always exclude the current period (x1). The OID periods are different to the Service periods. OID periods are calculated on the number of OID periods worked in the tax year (March to February). |
| Dir Exclusion Reason | Exclusion Reason |
| Terminated | Employee termination date |
Example of reporting for Employees:
Example 1:
An employee received earnings of R100 000 per month. Their earnings for the 2023 ROE season (OID limit of R568 959) will be reported as follows:
Example 2:
An employee received earnings of R200 000 per month. Employee was terminated on 31 May 2023.
Their earnings for the 2023 ROE season (OID limit of R568 959) will be reported as follows:
Example of the OID report
Examples of reporting of Directors
Example 1:
An employee received earnings of R100 000 per month. They were promoted to a Director on the 1st of September. The employees’ earnings as a Director were R150 000 per month. Their earnings for the 2023 ROE season (OID limit of R568 959) will be reported as follows:
NOTE: The employee will be counted as a Director for the entire year.
Example 2:
A Director received earnings of R100 000 per month. The Director was terminated on 31 June 2023.
Their earnings for the 2023 ROE season (OID limit of R568 959) will be reported as follows:
Explanation of the Summary section of the OID Report
On the ROE Form the employees that have OID Earnings up to and including R568 959 p.a. and those employees with OID Earnings above this amount must be shown separately.
Directors in each of these brackets must be shown separately from “ordinary” employees.
| Period | The period in the tax year |
Normal Employees: | |
| The number of employees that received income for that period |
| The employees adjusted OID earning |
| Directors | |
| The number of Directors that received income for that period |
| The Directors adjusted OID earnings |
| Total OID Earnings | Total of the OID earnings |
The Average Number of employees in each of these groups is calculated as:
NOTE: If you selected “Average Number of Employees” it will be indicated by an asterisk as follows.
Example 1:
An employee received earnings of R100 000 per month. The employee was terminated on 31 June 2023. Their earnings for the 2023 ROE season (OID Limit 568 959) will be reported as follows:
Example 2
An employee was employed from 1 March to 31 June 2023 (termination date). They had earnings of R100 000 for March and May and R75000 for April and June. Their earnings fo the 2023 ROE seaon (OID limit R568 959) will be reported as follows:
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